A combo of a surprisingly dovish RBA statement and weak global and domestic data dragged the Aussie to the bottom last week. Will this week’s catalysts give it some reprieve?
Australia won’t be publishing any top-tier reports this week, so Aussie traders will likely look to lower-tier releases for direction:
Home loans and NAB business confidence (Feb 12, 12:30 am GMT)
Tougher lending standards led to a 0.9% drop of home loan approvals in November. But while this is bad news for purchasing and construction of new dwellings, it’s good news for first time home buyers.
This week analysts expect to see a whopping 2.0% decline in home loan approvals in December.
Meanwhile, NAB’s business confidence report for the month of January is also due this week. The report has (almost) steadily dropped from 7 to 3 since August 2018, so it would be interesting to see if the downtrend persists in January.
Market risk appetite
The Reserve Bank of Australia (RBA)’s surprisingly dovish tone made it easy for traders to use the Aussie as an anti-risk bet last week.
This week, headlines related to Brexit negotiations, the U.S.-China trade war updates, and mid-tier reports from other major economies could provide the Aussie chances to recoup its losses. Or it could also deepen its wounds.
Whichever way market risk sentiment leans towards, make sure you’re around to trade any and all opportunities across AUD’s pairs!
Missed last week’s price action? Read AUD’s price recap for February 4 – 8!